Reginald Rivett, 60, was due to stand trial at Ipswich Crown Court next week after being accused of taking charitable donations made by mourners at funerals and keeping them for himself.

But on Wednesday, Rivett – who ran R Rivett Ltd Funeral Directors in Carlton Road, Kirkley – was told by a judge that he would not be given an immediate prison sentence as it was accepted he had not acted dishonestly.

Rivett, of Woodland Cottage, Yoxford, had denied a charge of fraud by abuse of position between October 2010 and November 2011 but on Wednesday he entered an acceptable guilty plea to a less serious charge of failing to keep adequate accounting records. He will now be sentenced next month.

Adjourning the case until the week commencing February 11 for a pre-sentence report, Judge David Goodin said Rivett had no previous convictions and would not be given an immediate prison sentence.

He said Rivett had originally been charged with fraud in relation to charitable donations, but since then the case against him had changed substantially.

In his basis of plea, Rivett said his family-run business, which had operated since 1888 through five generations, had run into cash flow problems after its operating overdraft facility was reduced by the bank.

As a result of reductions in expenditure, the company’s bookkeeper, whose duties had included record keeping in relation to charitable donations, was made redundant.

His barrister Steven Dyble told the court: “Mr Rivett accepts with a small minority of accounts that the record keeping was not acceptable and that this caused unreasonable delay in the settlement of these accounts.”

He added: “Mr Rivett maintains that he was not dishonest. He accepts he was wrong in the circumstances of this case not to take more care.”

Mr Dyble said that Rivett’s business had gone into liquidation despite his efforts to save the company. “This has caused him much distress,” he told the court.

He said the case involved hundreds rather than thousands of pounds and Rivett intended to make good any outstanding shortfall.

After the hearing, Det Sgt Simon Bridgland, of Lowestoft CID, said: “I would like to thank the detectives who have worked on this enquiry.”